Cite as U.S. v. Palmieri, 21 F.3d 1265 (3d Cir 1994); reversed and
remanded, 115 S.Ct. 413.
United States of America,
v.
James Palmieri, Appellant.
No. 93-5134.
United States Court of Appeals, Third Circuit.
Argued Oct. 7, 1993.
Decided April 11, 1994.
Sur Petition for Rehearing May 11, 1994.
David E. Schafer (Argued), Office of Federal Public Defender,
Trenton, NJ, for appellant.
Edna B. Axelrod, Daniel A. Greenstone (Argued), Michael
Chertoff, Office of the U.S. Atty., Newark, NJ, for appellee.
Before: HUTCHINSON, COWEN and NYGAARD, Circuit Judges
OPINION OF THE COURT
NYGAARD, Circuit Judge.
James Palmieri appeals from his conviction on one count of
knowingly engaging in the business of dealing in firearms without
being licensed to do so, in violation of 18 U.S.C. sections 922(a),
924(a), and one count of knowingly possessing and transferring a
machine gun, in violation of 18 U.S.C. sections 922(o), 924(a)(2).
He contends that the district court erred (1) by precluding a
defense based on his license as a collector of curios and relics,
(2) in responding to a jury question regarding licenses for selling
firearms, (3) in charging the jury on the machine gun element of
the second count, (4) by admitting lay opinion and hearsay
testimony relating to this element, and (5) in charging the jury on
the intent requirement for the second count. We conclude that these
assertions of error are without merit and will affirm.
I.
The facts are essentially undisputed. Palmieri met Ronald
Lyman, an FBI special agent, and John Debenedictus, a paid
informant, and sold Lyman three nine-millimeter semiautomatic
pistols (a German Luger, a Belgian Browning and a French MAB) for
$1,300. Although these weapons were manufactured during World War
II, each was functional. The following week, Palmieri, Lyman and
Debenedictus met again and Palmieri sold Lyman an M-1 carbine
semiautomatic rifle for $400. This weapon was a remanufactured
World War II vintage firearm, but it was also functional and could
be converted to be fully automatic.
Two weeks later, Palmieri, Lyman and Debenedictus once again
met, and Palmieri sold Lyman a 7.92 millimeter Chinese type 26
machine gun for $5,000. [footnote 1] Although at the time of sale,
Palmieri stated that the machine gun was fully operational and
fully automatic, when FBI special agent Robert W. Murphy later
examined the weapon, it was not operational. The machine gun was
designed to fire in a fully automatic mode, but it was missing a
required breechblock. The government and Palmieri dispute whether
the machine gun was operational when Lyman purchased it. The weapon
did, however, have a frame or receiver which is defined as "[t]hat
part of a firearm which provides housing for the hammer, bolt or
breechblock and firing mechanism...." 27 C.F.R. section 179.11
(1993). Palmieri met with Lyman and Debenedictus on several other
occasions, but sold them no other firearms.
At trial, the government introduced tape-recorded offers by
Palmieri to sell other weapons, store stolen goods and obtain
counterfeit passports. Palmieri's response to this evidence was
that these offers were puffery or were misconstrued. During the
relevant time period, Palmieri held a license from the Bureau of
Alcohol, Tobacco and Firearms ("ATF") as a collector of curios and
relics. The jury found Palmieri guilty on one count of engaging in
the business of dealing in firearms and one count of possessing and
transferring a machine gun. The district court sentenced him to 27
months' imprisonment on each count to be served concurrently.
II.
Count one of the superseding indictment charged Palmieri with
violating 18 U.S.C. section 922(a), which provides that:
(a) It shall be unlawful--
(1) for any person--
(A) except a licensed importer, licensed manufacturer, or
licensed dealer, to engage in the business of importing,
manufacturing, or dealing in firearms. ...
18 U.S.C.A. section 922(a)(l)(A) (West Supp. 1993). The first
element of a violation of section 922(a) is that the defendant
"engaged in the business" which, as applied to a dealer in
firearms, is defined as
a person who devotes time, attention, and labor to dealing in
firearms as a regular course of trade or business with the
principal objective of livelihood and profit through the
repetitive purchase and resale of firearms....
Id. section 921(a)(21)(C).
Although the definition explicitly refers to economic
interests as the principal purpose, [footnote 2] and repetitiveness
as the modus operandi it does not establish a specific quantity or
frequency requirement. In determining whether one is engaged in the
business of dealing in firearms, the finder of fact must examine
the intent of the actor and all circumstances surrounding the acts
alleged to constitute engaging in business. This inquiry is not
limited to the number of weapons sold or the timing of the sales.
For example, the location of the sales, the time and conditions
under which the sales occur, the defendant's behavior before,
during and after the sales, the price charged for and
characteristics of the firearms sold, and the intent of the seller
are all potentially relevant indicators of whether one has "engaged
in the business" of dealing.
A statutory exception to the definition of "engaged in the
business" is set forth in 18 U.S.C. section 921(a)(21)(C), which
provides that it
shall not include a person who makes occasional sales,
exchanges, or purchases of firearms for the enhancement of a
personal collection or for a hobby, or who sells all or part
of his personal collection of firearms.. ..
Id. section 921(a)(21)(C); see also id. section 922(a)(22)
(objective of livelihood and profit contrasted with improving or
liquidating a personal firearms collection). Hence, if Palmieri
sold firearms to Lyman from his private collection, he had a
defense under section 921(a)(21)(C) that these sales were "for the
enhancement of a personal collection or for a hobby," or
constituted the sale of "all or part of his personal collection of
firearms." Once again, however, there is no bright-line rule. The
fact-finder must determine whether the transactions constitute
hobby-related sales or engagement in the business of dealing from
the nature of the sales and in light of their circumstances.
Whereas the first element of a section 922(a) violation
addresses the character of the conduct, the second element focuses
on the status of the defendant, namely, whether he or she is a
licensed dealer. A "dealer" is statutorily defined as "any person
engaged in the business of selling firearms at wholesale or
retail," id. section 921(a)(11)(A), and a "collector" is defined as
"any person who acquires, holds, or disposes of firearms as curios
or relics...." Id. section 921(a)(13). [footnote 3] Section 922(a)
requires inquiry into both the defendant's conduct and status. If
the conduct constituted engaging in the business of dealing in
firearms, then it is illegal unless the defendant is a licensed
dealer. On the other hand, sales by a licensed or unlicensed
collector from a personal collection in furtherance of a hobby are
not illegal. Once the conduct is deemed equivalent to the business
of dealing, however, collector status will not shield a defendant
from liability under section 922(a).
The district court included the statutory exception to
"engaged in the business," see section 921(a)(21)(C), and the
definition of "with the principal objective of livelihood or
profit," see id. section 921(a)(22), in its charge to the jury. It
further instructed that:
In this case, you have heard testimony that during the time
period covered by the indictment, the defendant, James
Palmieri, was a licensed firearms collector. I instruct you as
a matter of law, that the collector's license possessed by the
defendant did not authorize him to sell any firearms, even
firearms that have been classified as curios or relics. I
further instruct you that what the defendant believed his
collector's license authorized him to do is not an issue in
this case, it is therefore, irrelevant to your determination
of the charges in this case.
The instruction that the collector's license did not authorize
any sales of firearms, although literally correct is potentially
misleading. The collector's license is immaterial because any
person can make occasional sales from his or her personal
collection without violating 18 U.S.C. section 922(a), whether a
licensed collector or not. Nonetheless, as stated above, a
collector's license does not authorize its holder to engage in the
business of dealing in firearms. Hence, the instruction that
Palmieri's collector's license, in and of itself, did not authorize
him to make the sales to Lyman is correct, albeit a bit truncated.
Palmieri's status as a licensed collector was not dispositive, and
he had no legally cognizable defense based on his collector's
license alone. The jury was Still required to determine the
character of the transactions, either as occasional sales in
furtherance of a hobby or as engagement in the business of dealing
in firearms. See United States v. Hooton, 662 F.2d 628, 635 (9th
Cir. 1981) (distinguishing intent to engage in business from intent
to enhance a gun collection), cert. denied 455 U.S. 1004, 102 S.Ct.
1640, 71 L.Ed.2d 873 (1982).
Although Palmieri was precluded from arguing that the sales
were authorized by his collector's license, the jury charge
included the statutory exception for sales from or to enhance a
personal collection. It also distinguished between the intent of
obtaining a livelihood and profit from the intent of liquidating a
personal collection. Thus, the jury was given the option of finding
that Palmieri's actions did not constitute engaging in the business
of dealing, irrespective of his collector's license. We have
reviewed the entire jury charge and conclude that it was sufficient
to enable Palmieri to present the defense that his sales were in
connection with his hobby. See Estelle v. McGuire, --U.S. --, --,
112 S.Ct. 475, 482, 116 L.Ed.2d 385 (1991) (considering challenged
jury instruction "in the context of the instructions as a whole and
the trial record"); United States v. McGill, 964 F.2d 222, 235 (3d
Cir.) (determining "whether the charge, taken as a whole and viewed
in the light of the evidence, fairly and adequately submits the
issues in the case to the jury") (quoting Link v. Mercedes-Benz of
North America, Inc., 788 F.2d 918, 922 (3d Cir. 1986)), cert.
denied -- U.S. --, 113 S.Ct 664, 121 L.Ed.2d 588 (1992). [footnote
4]
III.
During their deliberations, the jury asked the following
question: "Do you need a license to sell firearms under all
circumstances?" The district court answered this question by
telling the jury:
Ladies and gentlemen of the jury, counsel have seen your
question, and I have reviewed it with them, and the best
answer that I can give you to this is that that is not your
concern as a jury. You do not need to know everything about
under what circumstances a person could or could not do this.
What you need to do, and I'm going to try to help you to do it
by refocusing you on the instructions that you've been given,
is you need to just bear in mind what we have told you about
the law which is applicable to this case. And that is that you
need to determine on Count One and I assume this question is
directed at Count One, whether this individual, defendant, was
engaged in the business of dealing in firearms without a
license, without a federal dealer's license--federal firearm
dealer's license. Now, the language of that phrase is
referred to in the jury instructions. The term "engaged in
the business" is defined for you and it refers to certain
activities and then it says, but the terms [sic] does not
include and then you can see what that says. So I refer you to
that page to focus on that definition of what is engaged in
the business.
Furthermore, I refer you to the instruction that you
received on the next page, which is I instructed you as a ...
matter of law that the collector's license possessed by the
defendant did not authorize him to sell any firearms, and that
whatever he believed his collector's license permitted him to
do, authorized him to do, is not an issue in this case, and is
not for you to consider.
Thirdly, I refer you to the instructions ... on page 14,
which defines [sic] licensed dealer, and which sets [sic]
forth what the Secretary of the Treasury discovered through
searching the records of that agency, namely, that in the
period in question, there is no record that the defendant
currently held a federal firearms dealer's license. So, the
question, do you need a license to sell firearms under all
circumstances? You don't need to answer that question. What
you need to answer within the instructions that you've been
given, is the question of guilt or not guilt on Count One and
Count Two of this indictment.
The district court discussed with counsel how best to answer the
jury's question before doing so. Defense counsel did not object to
the proposed answer, and Palmieri's objection now that the district
court should have specifically referred to the language in the
statutes defining "engaged in the business" and "objective of
livelihood and profit" does not constitute plain error. See Fed.
R.Crim.P. 52(b); United States v. Young, 470 U.S. 1, 15, 105 S.Ct.
1038, 1046, 84 L.Ed.2d 1 (1985) (explaining that plain errors are
only those which undermine fundamental fairness and contribute to
a miscarriage of justice); Government of Virgin Islands v. Smith,
943 F.2d 677, 681 (3d Cir. 1991) (providing frame work for plain
error analysis).
IV.
The third issue focuses on the definition of "machine gun" for
purposes of 18 U.S.C.A. section 922(o) which states in relevant
part that: "[I]t shall be unlawful for any person to transfer or
possess a machine gun." 18 U.S.C.A. section 922(o) (West Supp.
1993). The term "machine gun" is statutorily defined in 26 U.S.C.
section 5845(b), which provides in part that:
[A]ny weapon which shoots, is designed to shoot, or can be
readily restored to shoot, automatically more than one shot,
without manual reloading, by a single function of the trigger;
The term shall also include the frame or receiver of any such
weapon, any part designed and intended solely and exclusively,
or combination of parts designed and intended, for use in
converting a weapon into a machine gun, and any combination of
parts from which a machine gun can be assembled if such parts
are in the possession or under the control of a person.
26 U.S.C.A. section 5845(b) (West 1989) (emphasis added); see also
18 U.S.C.A. section 921(a)(23) (West Supp. 1993) (referring to 26
U.S.C. section 5845(b)). The district court charged the jury with
the emphasized portion of the statute only, and the jury later
asked the district court to "[p]lease complete the second sentence,
which reads,'The term shall also include the frame or receiver of
any such weapon."' The district court answered as follows: "There
is no need to complete that sentence for purposes of this case,
because it--that sentence goes on and refers to things which are
not relevant to this case, so you may consider that phrase to be
the complete statement in that second sentence."
Palmieri contends that the second sentence of section 5845(b)
should be interpreted as creating a three-pronged definition for
the term "machine gun." In other words, a machine gun includes a
(1) frame or receiver, in conjunction with (2) any part or
combination of parts designed and intended to convert a weapon into
a machine gun, and (3) any combination of parts from which a
machine gun can be assembled. See United States v. Seven
Miscellaneous Firearms, 503 F.Supp. 565, 675 (D.D.C. 1980)
(reasoning that "frame or receiver" should not be contemplated in
isolation since Congress used the conjunctive rather than
disjunctive in the second sentence of section 5825(b)). An
alternative interpretation is that the second sentence of section
5845(b) "reflects a purpose to include three new categories of
weapons within the definition of a machine gun." United States v.
Kelly, 548 F.Supp. 1130, 1133 (E.D.Pa. 1982).
We exercise plenary review over this question of statutory
interpretation, see McGill, 964 F.2d at 235, and believe that the
answer is found in the plain language of the statute itself which
provides that machine gun "shall also include" items A, items B and
items C. This language confutes Palmieri's argument and, indeed,
includes three new categories within the definition of machine gun.
Reading the statute in the conjunctive would lead to the unlikely
result that both the parts for conversion into and the parts for
assembly of a machine gun as well as a frame or receiver are
required.
Alternatively, where the statutory language is susceptible to
more than one interpretation, a court "appropriately may refer to
a statute's legislative history to resolve statutory ambiguity."
Patterson v. Shumate, -- U.S.-- , --, 112 S.Ct. 2242, 2248, 119
L.Ed.2d 519 (1992) (quoting Toibb v. Radloff, 501 U.S. 157, 162,
111 S.Ct. 2197, 2200, 115 L.Ed.2d 145 (1991)). In this case, the
legislative history clearly indicates an intent to expand the
definition of machine gun. The Senate Report provides in part that:
The second sentence [of section 5845(b)] is new. It provides
three new categories as included within the term "machine
gun": (1) the frame or receiver of a machine gun, (2) any
combination of parts designed and intended for use in
converting a weapon other than a machine gun into a machine
gun; for example, so-called conversion kits, and (3) any
combination of parts from which a machine gun can be assembled
if such parts are in the possession of a person. This is an
important addition to the definition of "machine gun" and is
intended to overcome problems encountered in the
administration and enforcement of existing law. It is intended
that the three additional categories be subject to all the
provisions of the chapter applicable to serviceable machine
guns.
S.Rep. No. 1501, 90th Cong., 2d Sess. 45-46 (1968) (quoted in
Kelly, 548 F.Supp. at 1133).
We believe that the statutory language in section 5845(b) and
the legislative history mandate an interpretation that creates
three new categories for machine guns. This conclusion is supported
by case law from other circuits. See, e.g., Thompson/Center Arms
Co. v. United States, 92 F.2d 1041, 1047 (Fed.Cir. 1991) (finding
that 1968 amendments to machine gun definition provided three new
categories), aff'd, -- U.S. --, 112 S.Ct. 2102, 119 L.Ed.2d 308
(1992); United States v. Bradley, 892 F.2d 634, 635 (7th Cir.)
(asserting that parts may be machine guns without a frame or
receiver), cert. denied 495 U.S. 909, 110 S.Ct. 1935, 109 L.Ed.2d
298 (1990); United States v. Griley, 814 F.2d 967, 975 (4th Cir.
1987) (finding that frame or receiver in conjunction with evidence
at trial was sufficient to show that weapon was a machine gun);
United States v. Campbell, 427 F.2d 892, 893 (5th Cir. 1970)
(implicitly holding that parts may be machine guns without a frame
or receiver), cert. denied 402 U.S. 975, 91 S.Ct. 1673, 29 L.Ed.2d
140 (1971). [footnote 5]
V.
Palmieri's fourth contention is that the district court erred
by allowing certain testimony from government witnesses in relation
to the second count, possession and transfer of a machine gun. For
example, an FBI special agent who had not been qualified to testify
as an expert witness described the fifth weapon that Palmieri sold
to Lyman as a "fully automatic machine gun." Palmieri did not
object, but now claims that this was both an impermissible opinion
from a lay witness and a legal conclusion. Another agent gave the
following testimony as to the availability of a replacement
breechblock: "I called one of the larger gun part stores in the
country and asked them if I can get one and they told me that they
knew of a few people who had them and I can get one if I wanted."
Once again, Palmieri did not object, but he now asserts that this
was hearsay. On two other occasions, Palmieri did object to opinion
testimony by government witnesses who had not been qualified to
testify as experts in the area of questioning. Federal Rule of
Evidence 701 permits a lay witness to give an opinion which is:
"(a) rationally based on the perception of the witness and; (b)
helpful to a clear understanding of the witness' testimony or the
determination of a fact in issue." Thus, a lay opinion is
permissible when the witness has "firsthand knowledge of the
factual predicates that form the basis for the opinion ... [and] it
would help the jury to resolve a disputed fact." Government of
Virgin Islands v. Knight, 989 F.2d 619, 62930 (3d Cir.), cert.
denied, -- U.S. --, 114 S.Ct. 556, 126 L.Ed.2d 457 (1993); see also
Teen-Ed Inc. v. Kimball Int'l, Inc., 620 F.2d 399, 403 (3d Cir.
1980) ("A lay witness in a federal court proceeding is permitted
under Fed.R.Evid. 701 to offer an opinion on the basis of relevant
historical or narrative facts that the witness has perceived.").
Also, "testimony in the form of an opinion or inference otherwise
admissible is not objectionable because it embraces an ultimate
issue to be decided by the trier of fact." Fed.R.Evid. 704.
Palmieri challenges the lay opinion testimony of three FBI special
agents regarding machine guns. The agents' experience with machine
guns, however, was developed during direct examination, and their
testimony was subject to cross examination. Under these
circumstances, we conclude that this testimony was admissible under
Rule 701.
As to Palmieri's hearsay argument, Federal Rule of Criminal
Procedure 52(a) provides that: "[any] error, defect, irregularity
or variance which does not affect substantial rights shall be
disregarded." The jury need not have been "totally unaware" of the
error; rather, a court must "find that error unimportant in
relation to everything else the jury considered on the issue in
question, as revealed in the record." Yates v. Evatt, 500 U.S. 391,
403, 111 S.Ct. 1884, 1893, 114 L.Ed.2d 432 (1991); see also United
States v. Pavelko, 992 F.2d 32, 336 (3d Cir.) (considering "whether
there was evidence of sufficient quality and quantity presented at
trial to support the jury's verdict"), cert. denied sub nom. Kenney
v. United States -- U.S. --, 114 S.Ct. 272, 126 L.Ed.2d 223 (1993).
The testimony regarding a replacement bleechblock was hearsay.
Because, however, the evidence showed that the fifth weapon was, at
a minimum, a frame or receiver, we conclude that its admission was
harmless error.
VI.
Finally, Palmieri challenges the district court's jury
instruction on the intent requirement for the second count. 18
U.S.C. section 922(a)(2) requires the government to prove knowing
possession or transfer of a machine gun. The district court
instructed the jury that:
Knowingly means, with knowledge, that is, voluntarily and
intentionally and not because of mistake or accident or other
innocent reason. The purpose of adding the word knowingly is
to insure that no one would be convicted for an act done
because of mistake or accident or other innocent reason. The
Government is not required to prove that the defendant knew
that his acts were unlawful.
Although Palmieri did not object then, he now contends that the
district court's failure to instruct the jury that the government
must prove that Palmieri knew the weapon was a machine gun or a
firearm under 26 U.S.C. section 5845 constituted plain error.
In United States v. Freed, 401 U.S. 601, 91 S.Ct. 1112, 28
L.Ed.2d 356 (1971), the Supreme Court discussed the knowledge
requirement under an analogous statute, 26 U.S.C. section 5861(d),
which prohibits receipt or possession of an unregistered firearm.
The district court had dismissed the indictment because of the
lack of a scienter allegation. But section 5861(d) has no
statutory intent requirement, and the Freed Court reversed the
dismissal. See id at 607-10, 91 S.Ct. at 1117-18. It reasoned that
section 5861 was "a regulatory measure in the interest of the
public safety, which may well be premised on the theory that one
would hardly be surprised to learn that possession of hand grenades
[statutorily defined as firearms] is not an innocent act." Id at
609, 91 S.Ct. at 118. Although a violation of the statute at issue
here does have a statutory knowledge requirement, we must define
the scope of that requirement.
Ultimately, we are not persuaded by the argument that the
government had to prove Palmieri knew that the fifth weapon he sold
to Lyman was a machine gun or firearm within the meaning of 26
U.S.C. section 5845. The knowledge requirement for illegal
possession of a machine gun has two potential components, knowledge
that possession of the weapon was legally proscribed and knowledge
that the weapon possessed the statutorily defined physical
characteristics of a machine gun. In light of "the venerable
principle that ignorance of the law generally is no defense to a
criminal charge," Ratzlaf v. United States, -- U.S. --, --, 114
S.Ct. 655, 663, 126 L.Ed.2d 615 (1994) (citations omitted), and the
absence of a congressionally created exception for 18 U.S.C.
section 922(o), we discard the proposition that Palmieri had to
know that he was violating the law. Whether Palmieri knew that the
weapon he possessed fit the definition of a machine gun under
section 5845 presents a closer question. [footnote 6]
In the context of receipt or possession of an unregistered
firearm, some circuits have required knowledge that the weapon
falls within the statutory definition. [footnote 7] However, the
majority of circuits have set a lower threshold, requiring only
knowledge that the weapon was a firearm in the general sense,
[footnote 8] or mere knowledge that it was potentially dangerous
and subject to regulation. [footnote 9] We agree with the
common-sense approach of the latter position which requires a
person possessing a regulated device to investigate the scope of
his or her legal duties rather than blindly profess ignorance of
the applicable regulations. Accordingly, we find that the district
court's instruction on the intent requirement for the second count
did not constitute plain error.
VII.
During the oral argument before us, an issue arose as to
whether the second count was facially insufficient on the ground
that Palmieri, a licensed collector, sold a machine gun that is
classified as a "curio or relic" and thus not subject to 18 U.S.C.
section 922(o). [footnote 10] Section 922(o) provides that:
(o)(1) Except as provided in paragraph (2), it shall be
unlawful for any person to transfer or possess a machinegun.
(2) This subsection does not apply with respect to-
(A) a transfer to or by, or possession by or under the
authority of, the United States or any department or agency
thereof or a State, or a department, agency, or political
subdivision thereof; or
(B) any lawful transfer or lawful possession of a
machinegun that was lawfully possessed before the date this
subsection takes effect.
18 U.S.C.A. section 922(o) (West Supp. 1993). This provision took
effect on May 19, 1986, and the legislative history reflects an
effort to allow "possessors [sic] of lawfully registered machine
guns to continue their legal possession," and to enable "a person
to dispose of an unwanted legally registered machine gun by
permitting the Secretary to buy a machine gun from such person."
H.R.Rep. No. 99-495, 99th Cong., 2d Sess. 4 (1986), reprinted in
1986 U.S.C.C.A.N. 1327, 1330. Based on the plain language of
section 922(o)(1) and the presence of two statutorily defined
exceptions to the prohibition against transferring or possessing a
machine gun in section 922(o)(2), we decline to adopt a third
exception for a collector's possession of machine guns that qualify
as curios or relics.
It may be argued that 18 U.S.C. sections 922(a)(4), 922(b)(4)
and the ATF "Firearms Curios & Relics List" conflict with section
922(o). Section 922(a)(4) provides that:
(a) It shall be unlawful--
(4) for any person, other than a licensed importer,
licensed manufacturer, licensed dealer, or licensed collector,
to transport in interstate or foreign commerce any destructive
device, machine gun (as defined in section 5845 of the
internal Revenue Code of 1954), short barreled shotgun, or
short-barreled rifle, except as specifically authorized by the
Secretary consistent with public safety and necessity....
18 U.S.C.A. section 922(a)(4) (West 1976). Section 922(b)(4)
provides that:
(b) It shall be unlawful for any licensed importer,
licensed manufacturer, licensed dealer or licensed collector
to sell or deliver -
(4) to any person any destructive device, machinegun (as
defined in section 5845 of the Internal Revenue Code of 1954),
short-barreled shotgun, or shortbarreled rifle, except as
specifically authorized by the Secretary consistent with
public safety and necessity....
Id. section 922(b)(4). We find that section 922(a)(4) can be
harmonized with section 922(o) because it envisions a licensed
collector's ability to transport a machine gun that he or she
lawfully possessed before May 19, 1986. See id section
922(o)(2)(B). Similarly, section 922(b)(4) bars even licensed
collectors from selling or delivering a machine gun unless
specifically authorized by the Secretary. Although these statutes
refer to the Secretary's power to approve the transport, sale and
delivery of machine guns, we cannot imagine that the Secretary
would specifically authorize activity that is prohibited in section
922(o). We thus conclude that sections 924(a)(4) and 924(b)(4) are
not irreconcilable with section 922(o). [footnote 11]
Section IV of the "Firearms Curios & Relics List" issued by
the ATF is entitled, "National Firearms Act Weapons Classified As
Curios or Relics Under 18 U.S.C. Chapter 44." The text directly
preceding this list of weapons states that:
The Bureau has determined that the following National Firearms
Act weapons are curios or relics as defined in 27 CFR 178.11
because of their dates of manufacture. These National Firearms
Act weapons, classified as curios or relics, are still
subject to all the controls under the National Firearms Act.
However, licensed collectors may acquire hold or dispose of
them as curios or relics subject to the provisions of 18
U.S.C. Chapter 44 [which include 18 U.S.C. section 922(o)] and
27 CFR Part 178. They are still "firearms" as defined in the
National Firearms Act and Chapter 44 of Title 18, U.S.C.
(Id) (emphasis added.) The weapon at issue in this case, a Chinese
type 26 machine gun, appears on the section IV list. Although the
introduction to the "Firearms Curios & Relics List" states that
section IV weapons can be transferred to licensed collectors once
registration requirements have been met, we hold that the
prohibition against possessing or transferring a machine gun in 18
U.S.C. section 922(o) applies even when the weapon at issue is
classified by the ATF as a curio or relic. A transfer of a section
IV machine gun under the "Firearms Curios & Relics List" is
statutorily permitted in a limited context, see 18 U.S.C. section
922(o)(2)(A), and the section IV list is potentially useful to
those who lawfully possessed a machine gun before May 19, 1986. To
the extent it contradicts 18 U.S.C. section 922(o), however, the
statute trumps the ATF publication.
VIII.
In sum, we find that the district court's jury instructions
were sufficient to allow Palmieri to raise the defense that his
sales to Lyman were in furtherance of his personal collection. The
definition of a machine gun and the intent requirement for
possession or transfer of a machine gun set forth in the jury
charge similarly were not erroneous. Finally, the district court
did not err in responding to a jury question regarding licenses for
selling firearms or in admitting lay opinion testimony, and its
error in admitting hearsay testimony was harmless. The judgment of
the district court will be affirmed.
FOOTNOTES
1. This weapon is a copy or modification of a Czechoslovakian model
26 machine gun which was mistakenly referred to in the indictment.
2. The phrase "with the principal objective of livelihood and
profit" is defined as meaning that "the intent underlying the sale
or disposition of firearms is predominantly one of obtaining
livelihood and pecuniary gain." Id. section 921(a)(22).
3. "Curios and relics" are defined as "[f]irearms which are of
special interest to collectors by reason of some quality other than
is associated with firearms intended for sporting use or as
offensive or defensive weapons." 27 C.F.R. section 178.11 (1993).
The category of curios and relics which is relevant in this case is
"[f]irearms which were manufactured at least 50 years prior to the
current date...." Id.
4. Palmieri includes one sentence in his appellate brief arguing
that the district court held him "strictly liable" on the first
count. Although he did not object to the intent charge for this
count, we note that the government must prove that a defendant
"willfully" engaged in the business of dealing in firearms. See 18
U.S.C.A. section 924(a)(1)(D) (West Supp. 1993). The district
court instructed the jury that: "[I]t is not required that James
Palmieri knew that a license was required, nor that he had
knowledge that he was breaking the law. However, the Government
must prove that James Palmieri acted voluntarily and not because of
mistake or accident." This instruction alone would have been
insufficient to convey the requirement of willfulness, but in light
of the charge defining the "principal objective of livelihood and
profit" and the evidence presented, it did not constitute plain
error. See Henderson v. Kibbe, 431 U.S, 145, 154, 97 S.Ct. 1730,
1736, 52 L.Ed.2d 203 (1977) (asserting that absent objection,
improper instructions will rarely justify reversal of a criminal
conviction). Polsky v. Patron, 890 F.2d 647, 651-52 (3d Cir. 1989)
(holding that omission of the term "malice" was harmless since
charge given was functionally equivalent).
5. Adoption of this broader interpretation preempts any issue
stemming from the missing breechblock. The fifth weapon that
Palmieri sold to Lyman could fit within the definition of machine
gun as a weapon that could be "readily restored to shoot" or the
"frame or receiver of any such weapon." See 18 U.S.C.A. section
5845(b) (West 1989)
6. We note that the Supreme Court has granted review and heard oral
argument in Staples v. United States, No. 92-1441, which framed the
issue of whether Congress, when enacting 26 U.S.C. sections
5861(d), 5845 and 18 U.S.C. section 922(o), intended to create a
strict liability crime. See 62 U.S.L.W. 3357 (Nov. 23, 1993). The
defendant in Staples was convicted of unlawful possession of an
unregistered machine gun, in violation of 26 U.S.C. section
5861(d), and asserted on appeal that the government must prove that
he knew that the weapon he possessed was subject to registration.
See United States v. Staples, 971 F.2d 608, 612 (10th Cir. 1992),
cert. granted, -- U.S. -, 113 S.Ct. 2412, 124 L.Ed.2d 635 (1993).
7. See United States v. Williams, 872 F.2d 773, 777 (8th Cir. 1989)
requiring knowledge that weapon was automatic); United States v.
Anderson, 885 F.2d 1248, 1251 (5th Cir. 1989) (requiring knowledge
that weapon fell within statutory definition of a firearm); cf.
United States v. Harris, 959 F.2d 246. 261 (D.C.Cir.) (requiring
knowledge that receipt of weapon was proscribed), cert. denied, --
U.S.--, 113 S.Ct. 362, 121 L.Ed.2d 275 (1992).
8. See United Stales v. Mittleider, 835 F.2d 769, 774 (10th Cir.
1987) (requiring knowledge of possession of firearm in the general
meaning of the term), cert. denied, 485 U.S. 980, 108 S.Ct. 1279,
99 L.Ed.2d 490 (1988); United States v. Shilling, 826 F.2d 1365,
1368 (4th Cir. 1987) (same), cert. denied, 484 U.S. 1043, 108 S.Ct.
777, 98 L.Ed.2d 863 (1988); Morgan v. United States, 564 F.2d 803,
805 (8th Cir. 1977) (same); cf. United States v. Gonzalez, 719 F.2d
1516. 1522 (11th Cir. 1983) ("[G]overnment does not have to prove
that the defendant knew that the weapon in his possession was a
firearm within the meaning of the statute. or that he knew
registration was required.), cert. denied, 465 U.S. 1037, 101 S.Ct.
1312, 79 L.Ed.2d 710 (1984).
9. See United States v. Kindred, 931 F.2d 609, 612 (9th Cir. 1991)
("[G]overnment must prove that the defendant knew that he possessed
a dangerous device of a type that would alert one to the likelihood
of regulation."); United States v. Ross, 917 F.2d 997, 1001 (7th
Cir. 1990) ("Once a person knows that he possesses the sort of
device that is extensively regulated, ... it serves the statutory
scheme to cast on that person the risk of inaccuracy in evaluating
facts and law."), cert. denied, 498 U.S. 1122, 111 S.Ct. 1078, 112
L.Ed.2d 1183 (1991): United States v. DeBartolo, 482 F.2d 312, 316
(1st Cir. 1973) ("lt is enough to prove [defendant] knows that he
is dealing with a dangerous device of such type as would alert one
to the likelihood of regulation.").
10. Palmieri never contended that the machine gun he transferred
was exempt from the restriction present in section 922(o) based on
its status as a curio or relic either in the district court or in
the briefs he filed on appeal. Judge Hutchinson believes the
argument is waived, even though Palmieri's counsel did discuss it
at oral argument in response to questions posed from the bench.
Accordingly, Judge Hutchinson does not reach or decide the issue.
11. Cf. United States v. Dalton, 960 F.2d 121, 126 (10th Cir. 1992)
(holding that section 922(o) impliedly repealed statute barring
possession of unregistered machine gun, 26 U.S.C. section 5861(d),
where weapon was possessed after section 922(o)'s effective date);
accord United States v. Kurt, 988 F.2d 73, 75 (9th Cir. 1993);
Staples, 971 F.2d at 6111.
COWEN, Circuit Judge, dissenting:
At stake in this case are the interpretation of an important
statute and the liberty interest of defendant James Palmieri. In
addition, the issues posed here for adjudication are of keen
interest to many gun collectors. Although I recognize the
compelling interest in strictly enforcing laws concerning ownership
and dealing in firearms, I respectfully dissent, because I disagree
with the majority with respect to the interpretation of both the
gun collector exception under the Gun Control Act, as amended 18
U.S.C. sections 921-928 (1988 & Supp. IV 1992), and the jury charge
by the district court. I also believe that even if the majority is
correct with respect to statutory construction, due process
requires that Count 2 against Palmieri be dismissed.
I.
The central question Palmieri presents is whether the district
court erred in refusing to allow him to present evidence of the
firearm collector exception to the jury, and in refusing to fully
instruct the jury on this theory. Accordingly, the court must
determine whether there is a gun collector exception, and whether
there was record evidence offered by Palmieri in support of his
position. See U.S. v. Paolello, 951 F.2d 537, 539 (3d Cir. 1991).
If Palmieri put forth a gun collector defense, we must then examine
the district court's instructions as a whole to assess whether they
adequately presented to the jury the defense theory. Id. See also
United States v. Turley, 891 F.2d 57, 62 (3d Cir. 1989).
II.
The escalating use of firearms in violent crimes led Congress to
enact the Gun Control Act of 1968, as amended, 18 U.S.C. sections
921-928 (the Act), in order to "strengthen Federal regulation of
interstate firearms traffic." H.R.Rep. No. 90-1577, 90th Cong., 2d
Sess. 7 (1968), reprinted in 1968 U.S.C.C.A.N. 4410, 4412. The Act
prohibits a person from acting as a gun dealer without a dealer's
license, 18 U.S.C. section 922(a)(1), and, as amended, bans
possessing and transferring a machinegun, [footnote 1] 18 U.S.C.
section 922(o). Palmieri claims that there is a valid gun collector
exception under the Gun Control Act, and that he is such a licensed
collector. He argues that he cannot be convicted of violating
section 922(a)(1) if the jury accepts his position that he is a
bona fide collector and not a dealer in firearms. He also argues
that he cannot be convicted of violating section 922(o) if the
machinegun at issue is a curio or relic as defined by the Secretary
charged with enforcing the Gun Control Act.
A.
The Gun Control Act focuses on the licensing and controlling
of firearm dealers. See United States v. Reminga, 493 F.Supp. 1351,
1354 (W.D.Mich. 1980). The Act makes it unlawful for any person
"except a licensed importer, licensed manufacturer, or licensed
dealer to engage in the business of importing, manufacturing, or
dealing in firearms, or in the course of such business to ship,
transport, or receive any firearm in interstate or foreign
commerce." 18 U.S.C. section 922(a)(1).
The Act defines "dealer" as "any person engaged in the
business of selling firearms or ammunition at wholesale or retail."
18 U.S.C. section 921(a)(11). The Act further defines "engaged in
the business," when applied to a dealer in firearms, as meaning
a person who devotes time, attention, and labor to dealing in
firearms as a regular course of trade or business with the
principal objective of livelihood and profit through the
repetitive purchase and resale of firearms, but such term
shall not include a person who makes occasional sales,
exchanges, or purchases of firearms for the enhancement of a
personal collection or for a hobby, or who sells all or part
of his personal collection of firearms.
Id. section 921(a)(21)(C).
The phrase "with the principal objective of livelihood and
profit" is defined to mean that
the intent underlying the sale or disposition of firearms is
predominantly one of obtaining livelihood and pecuniary gain,
as opposed to other intents, such as improving or liquidating
a personal firearms collection: Provided, That proof of profit
shall not be required as to a person who engages in the
regular and repetitive purchase and disposition of firearms
for criminal purposes or terrorism.
Id. section 921(a)(22).
A fair reading of these provisions leads to the conclusion
that to fall within the definition of "dealer," the seller of
firearms must have dealt in firearms in substantial quantity and
frequency, in sum, in a manner which can fairly be characterized as
a regular course of trade or business.
B.
Palmieri challenges his conviction on Count 1 by claiming that
there is a gun collector exception to the ban on gun dealing
without a dealer's license, and claims the benefit of the exception
because he is such a collector. Accordingly, we must examine the
status of a gun collector under the Gun Control Act.
When enacting the Gun Control Act of 1968, Congress did not
intend to ban gun collecting as a hobby. Congress announced that
"[g]un collectors could continue their hobby." H.R.Rep. No. 91577,
supra, at 9, reprinted in 1968 U.S.C.C.A.N. at 4415. To make this
possible, Congress essentially adopted three measures. The first
made it lawful for anyone to possess an antique firearm [footnote
2] by exempting antique firearms from the coverage of the Gun
Control Act, see 18 U.S.C. section 921(9)(3). In effect, anyone can
collect, possess and transfer antique firearms, even if such
firearms fall within some other definition, such as that for
machineguns.
Second, Congress established a collector exception under the
Act which allows a collector to transact in certain firearms. The
Act defines "collector" as "any person who acquires, holds, or
disposes of firearms as curios or relics, as the Secretary shall by
regulation define." 18 U.S.C. section 921(a)(13). Nowhere else in
the Act did Congress specifically state what collectors (as opposed
to licensed collectors who hold a federal collectors license) may
or may not do. However, it is clear that Congress intended to
allow collectors to buy and sell curios and relics [footnote 3]
through intrastate transactions, so long as this activity stops at
the level of a hobby and does not rise to that of a regular course
of trade. The Act explicitly bans interstate transactions with
certain exceptions for licensed dealers and licensed collectors,
but does not ban intrastate transactions. See 18 U.S.C. section
922.
The legislative history and the statutory scheme support the
conclusion that collectors can collect curios and relics within
their home state. Congress declared that "[g]un collectors could
continue their hobby." H.R.Rep. No. 90-1577, supra, at 9, reprinted
in 1968 U.S.C.C.A.N. at 4415. The Act criminalizes dealing in
firearms as a regular course of trade without a dealer's license,
rather than banning all sales. 18 U.S.C. section 922(a). The Act
carves out a hobby exception to the "regular course of trade"
definition by stating that occasional sales to enhance or liquidate
a personal collection are not such a course of trade. See 18 U.S.C.
section 921(a)(21)(C). This is one of several instances in which
the Act specifically accommodates gun collectors.
This interpretation is also buttressed by the interpretation
of the Bureau of Alcohol, Tobacco and Firearms (ATF), which is
charged with administering the Gun Control Act through delegation
by the Secretary, see 27 C.F.R. Pt. 178, who in turn receives
authority from Congress, see 18 U.S.C. section 926. In an official
publication, ATF explicitly states that "[a] person need not be
federally licensed to collect curios or relics." ATF, Firearms
Curios and Relics List (1972-1989), ATF P. 5300.11 at 2 (1990 ed.)
(hereinafter ATF List ), App. at 620.
The third measure that Congress adopted was to establish a
licensing system for gun collectors, and to authorize "licensed
collectors" to engage in interstate transfers of curios and relics.
Congress first defined "licensed collector" as any collector
"licensed under the provisions of [the Gun Control Act]." 18
U.S.C. section 921(a)(13). Any person desiring to be a licensed
collector may apply to the Secretary for such a license, which
license only applies to transactions in curios and relics. 18
U.S.C. section 923(b).
A licensed collector presumably may engage in any activities
that a non-licensed collector may conduct. In addition, a licensed
collector may engage in interstate transactions in curios and
relics under 18 U.S.C. section 922(a)(2) (shipping or transporting
firearms into interstate or foreign commerce), section 922(a)(3)
(receiving firearms from out-of-state), section 922(a)(4)
(transporting destructive devices and machineguns into interstate
or foreign commerce), and section 922(a)(5) (transferring firearms
to a person from out-of-state). These are prohibited transactions
for a collector who does not have a collector's license. For
intrastate transactions, licensed collectors may also trade with
other licensed collectors, licensed dealers, licensed importers,
and licensed manufacturers, without certain restrictions set forth
in 18 U.S.C. section 922(b). A licensed collector can also sell or
deliver curio machineguns to a person through intrastate
transactions if the Secretary so authorizes. Id. section 922(b)(4).
The regulation promulgated by the Secretary, who administers
the Gun Control Act, succinctly summarizes the privileges of a
licensed collector:
[A collector's] license shall, subject to the provisions of
the Act and other applicable provisions of law, entitle the
licensee to transport, ship, receive, and acquire curios and
relics in interstate or foreign commerce, and to make
disposition of curios and relics in interstate or foreign
commerce, to any other person licensed under the provisions of
this part, for the period stated on the license.
27 C.F.R. section 178.41(c) (1993).
The statutory provisions, regulations and legislative history
clearly indicate that the collector and licensed collector
exceptions are written into and pervade the Gun Control Act. They
apply when curios and relics are the subject of the transaction, so
long as the collector's activities do not rise to a level that
requires further licensing under the Act.
C.
The collector exception to the prohibition against acting as
a gun dealer without a proper license under 18 U.S.C. section
922(a)(1) is not absolute. If a collector has engaged in a
substantial quantity of transactions in curios and relics, he may
be deemed a dealer, who must obtain a dealer's license.
Considered as a whole, the three measures discussed above
unquestionably lead to the conclusion that a non-licensed collector
may collect curios and relics and conduct transactions in firearms
that are listed as curios and relics by the Secretary with a person
from the collector's home state, without running afoul of 18 U.S.C.
section 922(a)(1), if such transactions do not amount to a regular
course of trade. A licensed collector is permitted to do everything
that a non-licensed collector can and, in addition, to engage in
interstate transactions in curios and relics, so long as the
transactions do not amount to a regular course of trade. If the
jury finds that an individual is merely a collector, or a licensed
collector, such a person may not be convicted of acting as a dealer
without a license.
Although neither the statutory provisions nor the regulations
that specifically address the status of a collector explicitly
state the number of transactions a collector or a licensed
collector may engage in without crossing the line from gun
collector to gun dealer, it would be inappropriate to contend that
dealing in curios and relics is completely exempt from the
prohibition against gun dealing without a license. The Act does not
contain an explicit and complete exemption for curios and relics
like the complete exemption for antique firearms. Congress intended
to permit gun collecting as a hobby rather than a large growth
industry. Indeed, the explicit statutory exception to the regular
course of trade definition permits only occasional sales for the
enhancement or liquidation of personal collections. See 18 U.S.C.
section 921(a)(21)(C). In other words, a collector, if engaging in
numerous transactions, can cross the line and become a dealer. The
Secretary's regulation makes this clear:
A collector's license does not authorize the collector to
engage in a business required to be licensed under the Act....
Therefore, if the acquisitions and dispositions of curios and
relics by a collector bring the collector within the
definition of a manufacturer, importer, or dealer[,] he shall
qualify as such.
27 C.F.R. section 178.41(d) (1993). The change of status from a
collector to a dealer is one of quantity and degree. Having a
collector's license does not necessarily preclude one from being
deemed a dealer without a dealer's license.
Accordingly, the theory of a firearm collector or licensed
collector exception to 18 U.S.C. section 922(a)(1) is legally
sound. This is so even though a collector is not necessarily
completely exempt from section 922(a)(1). There may be situations
where a jury may properly conclude that a person with a collector's
license is actually a dealer without a dealer's license.
D.
Palmieri was convicted on Count 2 for possessing and
transferring a machinegun. The machinegun in question was listed by
ATF in its own official publication as a curio or relic. This
conviction cannot stand if the collector or licensed collector
exception applies to the prohibition against possessing and
transferring machineguns under 18 U.S.C. section 922(o). [footnote
4] This section states:
(1) Except as provided in paragraph (2), it shall be unlawful
for any person to transfer or possess a machinegun.
(2) This Subsection does not apply with respect to-
(A) a transfer to or by, or possession by or under the
authority of, the United States or any department or
agency thereof or a State, or a department, agency, or
political subdivision thereof; or
(B) any lawful transfer or lawful possession of a
machinegun that was lawfully possessed before the date
this subsection takes effect.
18 U.S.C. section 922(o). This provision was added to the Gun
Control Act in 1986, - see Pub.L. 99-308, section 102(9), 100 Stat.
452-53, in recognition that machineguns had frequently been "used
by racketeers and drug traffickers for intimidation, murder and
protection of drugs and the proceeds of crime," H.R.Rep. No.
99-495, 99th Cong., 2d Sess. 4 (1986), reprinted in 1986
U.S.C.C.A.N. 1327, 1330.
Obviously the prohibition under section 922(o) does not depend
upon the number of transactions made; it is a complete ban if it
applies. The clear language of section 922(o) states that it is
unlawful for any person to possess or transfer a machinegun unless
such possession or transfer is made to or by or "under the
authority" of the United States, section 922(o)(2)(A), or the
machinegun was lawfully possessed before the effective date of the
section, section 922(o)(2)(B).
There is an interface between section 922(o) and sections
921(a)(13) and 926. Certain machineguns within the meaning of
section 922(o) can be listed as curios and relics available for gun
collecting by the Secretary under sections 921(a)(13), 926. Read in
the context of the collector or licensed collector exception that
pervades the Act, the term "machinegun" in section 922(o) must be
considered to have a built-in exception so as to read "such term
does not include curios and relics." This interpretation comports
with the general statutory scheme of the Gun Control Act to afford
an avenue for gun collectors to continue their hobby of collecting
curios and relics. This reading is in accordance with statutory
provisions that specifically authorize or permit the Secretary to
authorize a licensed collector to transact in machineguns. See 18
U.S.C. section 922(a)(4), (b)(4).
In addition, the interpretation of the Secretary, who is
authorized to administer the Act, lends support to this
construction. Under such authority, the Secretary has promulgated
regulations defining the term "curios and relics", see 27 C.F.R.
section 178.11, and published through ATF a list of firearms that
are curios and relics. Subsequent to the addition of section 922(o)
in 1986, the Secretary has continued to classify many machineguns
as curios and relics and placed them in Section IV of that list.
See ATF List, supra, at 27 et seq.; App. at 626-27. Clearly ATF
considers these machineguns, which it has classified as curios or
relics, as not being within the general prohibition under section
922(o). Thus these firearms can be possessed and transferred by
collectors. In the introduction to the curios and relics list, ATF
specifically addresses the transfer requirements for the
machineguns contained in Section IV. It states that "[o]nce the
registration requirements [under the National Firearms Act] have
been met, transfer may be made intrastate or interstate to licensed
collectors on AFT Form 4." Id at 3; App. at 621. [footnote 5]
Section 922(o) is susceptible of an interpretation more
sweeping than the construction set forth above. This broad
interpretation would hold that the prohibition is absolute and thus
even a collector or licensed collector would be prohibited from
possessing or transferring a machinegun although such, a firearm is
classified as a curio or relic by the Secretary, if the collector
cannot claim any specific exceptions contained in section
922(o)(2)(A) or (B). The specific statutory exceptions contained
in section 922(o) do not apply to a normal collector or licensed
collector. Fairly read, the exception in section 922(o)(2)(A)
applies only to the United States or the states and their political
subdivisions and agents. The "under the authority" language does
not appear to include the licensing system. See United States v.
Warner, 5 F.3d 1378, 1381 (10th Cir. 1993) (section 922(o)(1)(A)
permits only possession of machineguns by federal or state agents
acting in an official capacity), cert. denied, -- U.S. --, 114 S.Ct
1090, 127 L.Ed.2d 405 (1994). Section 922(o)(2)(B) relates only to
the time of initial possession. [footnote 6] Therefore, the
argument runs, there is no collector or licensed collector
exception expressly written or fairly inferred in section 922(o).
This is the interpretation argued by the government and what Judge
Nygaard adopts.
So construed, section 922(o) conflicts with the general scheme
that Congress enacted to make it possible for collectors to collect
curios and relics, including machineguns, if they are classified as
curios and relics by the Secretary. Such a broad reading of
section 922(o) would require concluding that when adding section
922(o) to the Gun Control Act, Congress impliedly repealed the
general gun collection scheme to the extent that the law then in
place allowed machineguns to be collected as curios and relics.
In fact, such a broad reading necessitates an implied repeal
of not only the general gun collecting scheme, but also two
subsections specifically dealing with machineguns, 18 U.S.C.
section 922(a)(4), (b)(4). With the general qualification that they
can only conduct transactions in curios and relics, see section
923(b), licensed collectors are specifically authorized to
transport machineguns in interstate and foreign commerce, section
922(a)(4), and to buy and sell machineguns within a state if the
Secretary so authorizes, section 922(b)(4). ATF has classified many
machineguns as curios and relics which gun collectors may acquire
and dispose of in an appropriate transaction. See ATF List, supra,
at 29, App. 626.
Judge Nygaard attempts to harmonize his reading of section
922(o) with section 922(a)(4), (b)(4) by stating that "[section
922(a)(4] envisions a licensed collector's ability to transport a
machine gun that he or she lawfully possessed before May 19, 1986
[the effective date of 922(o)]," Maj.Op. at 1274-75, and that "we
cannot imagine that the Secretary would specifically authorize
activity that is prohibited in section 922(o)," id. This attempt
fails.
With respect to section 922(a)(4), Judge Nygaard does not ask
whether a private citizen can receive (or possess) a machinegun
transported to him by an owner who possessed it before May 19,
1986. Under Judge Nygaard's reading of section 922(o), private
possession and transfer of machineguns are categorically banned if
the possession did not take place before May 19, 1986. After this
day, no private person may buy or receive a machinegun from an
owner who possessed it before this day although the latter may sell
it. An owner would therefore not be able to transport the
machineguns (which he possessed before that day) into interstate
commerce for the purpose of transferring-it to another private
citizen because the latter would not be able to receive it. Perhaps
Judge Nygaard envisions that a machinegun placed in the stream of
commerce stays in the interstate transportation line forever,
without reaching a destination. Accordingly, Judge Nygaard's
reading of the interplay between section 922(o) and section
922(a)(4) reaches a result which is totally unacceptable.
With respect to section 922(b)(4), the Secretary has
specifically authorized the machinegun at issue in this case to be
available for possession and transfer by placing it in his official
publication, the ATF curios and relics list, and by stating that it
can be transferred, so long as the licensed collector complies with
the registration requirements, "either intrastate or interstate to
licensed collectors on ATF Form 4." ATF List, supra, at 3; App. at
621. This authorization was not "imagination," as Judge Nygaard
intimates, but was published for the express and specific purpose
of giving guidance to private gun collectors. Even though this is
not an individualized authorization, it is a specific authorization
for a class of citizens--the licensed collectors. Obviously, the
Secretary construed the Gun Control Act as authorizing him to do
so. Judge Nygaard contends that what the Secretary did was
prohibited by section 922(o). However, because the statutory
provisions are confusing and ambiguous, the Secretary is entitled
to deference. See infra at 1284 (discussing Chevron, U.S.A., Inc.
v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct
2778, 81 L.Ed.2d 694 (1984)).
Judge Nygaard's reading of section 922(o) also conflicts with
the last paragraph of section 92203), which I shall term "trading
between federal licensees provision." Section 922(b) first places
certain restrictions on federal licensees when they deal with non-
licensees. See section 922(b)(1) (minimum age limit), (b)(2)
(compliance with state law), (b)(3) (no local sale to out-of-state
persons), (b)(4) (specific authorization of the Secretary
required). The last paragraph of section 922(b) states that these
restrictions "shall not apply to transactions between licensed
importers, licensed manufacturers, licensed dealers, and licensed
collectors. Paragraph [(b)(4)] shall not apply to a sale or
delivery to any research organization designated by the Secretary."
section 922(b). Obviously, this "trading between licensees
provision" allows federal licensees to trade curio machineguns
between themselves and with designated research organizations.
While it is true that section 922(o)(2)(A) permits an owner to
transfer a machinegun to a federal or state instrumentality,
section 922(a)(4) cannot be limited to transporting a machinegun to
such an entity. Section 922(a)(4) permits transporting machineguns
for the purpose of engaging in commerce. The language states that
federal licensees may publication, the ATF curios and relics list.
"transport [a machinegun] in interstate or foreign commerce."
section 922(a)(4). Such language defies any attempt to read it
restrictively because even if one might try to equate the term
"transport in interstate commerce" with "transport to a federal or
state instrumentality," no one would say that "transport in foreign
commerce" also means "transport to a federal or state
instrumentality." "Foreign commerce" means foreign commerce.
Neither can section 922(b)(4) be limited to sales to governmental
instrumentalities because the Secretary specifically authorized
transfers to be made to other "licensed collectors." ATF List,
supra, at 3; App. at 621. Nor can the "trading between federal
licensees provision" be so limited. This provision permits trades
between all federal licensees, private or otherwise.
The broad interpretation espoused by Judge Nygaard may also
conflict with the statutory exemption of antique firearms from the
Act. See 18 U.S.C. section 921(a)(3), (a)(16). The Gun Control Act
exempts antique firearms from its coverage not by making an
explicit separate exemption, but by exempting them from the
definition of "firearm" in section 921(a)(3). But antique firearms
are not specifically exempted from the definition of "machinegun."
Thus one may argue that, if an antique is also a machinegun, under
the broad, absolutist interpretation of section 922(o), one cannot
legally possess that antique machinegun, if he had not legally
possessed it before section 922(o) went into effect, because
section 922(o) does not contain a specific exemption for such an
antique firearm.
Reading section 922(o) as a broad prohibition applicable to
collectors and licensed collectors dealing in curios and relic
machineguns conflicts significantly with other provisions of
the Gun Control Act. Faced with a choice, we should choose a
reading of section 922(o) that permits a collector or licensed
collector exception. Several factors militate in favor of this
interpretation. First, section 922(o), as an amendment to the Gun
Control Act must be construed with the Act as a whole rather than
in isolation. "Statutory construction is a holistic endeavor ...
and, at a minimum, must account for a statute's full text, language
as well as punctuation, structure, and subject matter." United
States Nat'l Bank of Oregon v. Independent Ins. Agents of Am.,
Inc., -- U.S. --, --, 113 S.Ct. 2173, 2182, 124 L.Ed.2d 402 (1993)
(internal quotation marks and citations omitted). Put another way,
"'[i]n expounding a statute, we must not be guided by a single
sentence or member of a sentence, but look to the provisions of the
whole law, and to its object and policy.'" Id. (quoting United
States v. Heirs of Boisdore, 49 U.S. (8 How.) 113, 122, 12 L.Ed.
1009 (1849)). Thus, "[a] statute should be construed so that effect
is given to all its provisions, so that no part will be inoperative
or superfluous, void or insignificant." 2A Norman J. Singer,
Sutherland Stat. Const. section 46.06, at 119-20 (5th ed. 1992)
(citations omitted).
If a holistic consideration of the statutory context does not
reveal Congress' intent to provide an absolute and total ban, we
need not accord such a reading to a 922(o). Congress did not
indicate, either in statutory language or legislative history, an
intent to repeal or modify other provisions of the Gun Control Act
when adding section 922(o). Rather, it only aimed to curb the use
of machineguns by "racketeers and drug traffickers for
intimidation, murder and protection of drugs and the proceeds of
crime." H.R.Rep. No. 99-495, supra, at 4, reprinted in 1986
U.S.C.C.A.N. at 1330.
Second, "[s]tatutes for-the same subject, although in apparent
conflict, are construed to be in harmony if reasonably possible."
2B Singer, supra, section51.02 at 122. One cardinal rule of
statutory construction is that "repeals by implication are not
favored." Morton v. Mancari, 417 U.S. 535, 549-50, 94 S.Ct 2474,
2482, 41 L.Ed.2d 290 (1974) (internal quotation marks and citations
omitted). An implied repeal construction is permitted only when the
seemingly conflicting statutes are absolutely irreconcilable. Id at
550, 94 S.Ct at 2482. See also Ruckelshaus v. Monsanto Co., 467
U.S. 986, 1018, 104 S.Ct 2862, 2880, 81 L.Ed.2d 815 (1984). When
confronted with seemingly inconsistent statutory provisions, we
have a "duty to construe the statutes in such a way to give effect
to both, if possible." United States v. Bruno, 897 F.2d 691, 695
(3d Cir. 1990). When statutory provisions are capable of
co-existence, "it is the duty of the courts, absent a clearly
expressed congressional intention to the contrary, to regard each
as effective." Morton, 417 U.S. at 551, 94 S.Ct at 2483.
The gun collector exception and section 922(o) are not
irreconcilable because section 922(o) and the seemingly conflicting
sections of the Gun Control Act can co-exist if we recognize that
Congress intended it to be lawful for collectors to possess and
transfer machineguns that are curios and relics. [footnote 7] The
collector exception is an exception to the general prohibition
against machinegun possession and transfer. This is analogous to
the situation in Morton, where the Supreme Court held that "[a]
provision aimed at furthering Indian self-government by according
an employment preference within the [Bureau of Indian Affairs] for
qualified members of the governed group can readily co-exist with
a general rule prohibiting employment discrimination on the basis
of race." 417 U.S. at 550, 94 S.Ct at 2482.
Nor is there any indication, not to mention any "clearly
expressed congressional intention," id at 551, 94 S.Ct. at 2483, of
a repeal of the gun collection scheme or the specific sections that
authorize licensed collectors to conduct transactions in curio
machineguns. Congress never stated in the statute amending the Gun
Control Act that the existing gun collecting scheme would be
repealed, nor does the legislative history reflect any such intent.
The pervading theme of the Gun Control Act is that gun aficionados
be allowed to collect curios and relics including curio
machineguns. When adding section 922(o), Congress did not
specifically restrict the ability of licensed collectors to collect
curios and relics that are also machineguns and to transport them
into interstate or foreign commerce under section 922(a)(4). Nor
did Congress restrict the Secretary's authority under 18 U.S.C.
section 921(a)(13), 926 ta classify machineguns as curios and
relics or under section 922(b)(4) to authorize sales and delivery
of machineguns. Indeed, when analyzing section by section the 1986
amendments to the Gun Control Act, Congress specifically summarized
section 922(a)(4) and (b)(4) and mentioned machineguns, without
noting any effect that section 922(o) would have on section
922(a)(4) and (b)(4). See H.R.Rep. No. 99-495, supra, at 22,
reprinted in 1986 U.S.C.C.A.N. at 1348. Accordingly, it is
improbable that Congress impliedly repealed, without indicating its
intent to do so, the gun collecting scheme with respect to curio
machineguns, when such a repeal would eliminate several sections
pertaining to collecting machineguns as curios and relics from the
Gun Control Act, which sections have been in existence since 1968.
Third, because of the ambiguities surrounding the meaning of
the term "machinegun" and "curios and relics," we should defer,
under the holding of Chevron, U.S.A, Inc. v. Natural Resources
Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778,. 81 L.Ed.2d
694 (1984), to the interpretation of ATF, the administrative agency
charged with administering the Gun Control Act. Chevron instructs
us that "if the statute is silent or ambiguous with respect to the
specific issue, the question for the court is whether the agency's
answer is based on a permissible construction of the statute," id.
at 843, 104 S.Ct. at 2782, and that "a court may not substitute its
own construction of a statutory provision for a reasonable
interpretation made by the administrator of an agency." Id at 844,
104 S.Ct at 2782. Congress explicitly authorized the Secretary to
define curios or relics so that a collector may acquire or dispose
of them. 18 U.S.C. section 921(a)(13). ATF has denominated certain
machineguns as curios and relics, and specifically advised that
they may be possessed and transferred by a collector under the Act.
See ATF List, supra, at 3, 2930, App. at 621, 626-27. See also,
supra, footnote 2. Such an interpretation no doubt more than meets
the deferential reasonableness test under Chevron. We should not
substitute our statutory construction for the inherently legal and
practical interpretation of ATF.
Finally, construing the term "machinegun" in section 922(o) as
excluding curios and relics comports with the tradition of courts
to interpret terms shrouded in ambiguities derived from outside the
particular statutory provision flexibly in order to give effect to
the intent of the authors of a statute. Courts have not rigidly
adhered to the literal terms of explicit language when there is an
ambiguity external to that language under review and when the
particular context militates for a flexible interpretation. See,
e.g., Johnson v. Transportation Agency of Santa Clara County, Cat,
480 U.S. 616, 627, 107 S.Ct. 1442, 1449, 94 L.Ed.2d 615 (1987)
(analyzing affirmative action plan under the standard announced in
Weber, infra); United Steelworkers of Am. v. Weber, 443 U.S. 193,
201, 99 S.Ct. 2721, 2726, 61 L.Ed.2d 480 (1979) (interpreting the
Civil Rights Act of 1964 "against the background of the legislative
history of Title VII and the historical context from which the Act
arose"); Christiansburg Garment Co. v. EEOC, 434 U.S. 412, 418, 98
s.ct. 694, 699, 54 L.Ed.2d 648 (1978) (rejecting a "mechanical
construction" of section 706(k) of Title VII of the Civil Rights
Act of 1964); cf. in re House Bill No. 1291, 178 Mass. 605, 60 N.E.
129 (Mass. 1901) (interpreting flexibly the "written vote"
requirement in the Constitution of Massachusetts as permitting use
of voting machines). See also Richard A. Posner, Problems of
Jurisprudence 262-69 (1990) (explaining the fallacies of the plain
meaning rule and criticizing rigid statutory interpretation).
For the foregoing reasons, we should regard each of the
sections of the Gun Control Act as effective and recognize the gun
collector exception to section 922(o). This interpretation gives
full effect to the Gun Control Act, accords with legislative
history, and respects the interpretation of the administrative
agency charged with enforcing the specific law under review.
III.
The second task is to examine the record to determine whether
it sufficiently supports Palmieri's defense that he fell within the
collector exception to section 922(a)(1) and section 922(o).
[footnote 8] In so doing, we must consider the record as a whole.
See generally U.S. v. Paolello, 951 F.2d 537, 539 (3d Cir. 1991).
With respect to Count 1, Palmieri attempted to show that he is
merely a collector, making only occasional transactions in curios
and relics. It is undisputed that Palmieri has a collector's
license. However, as discussed above, possession of such a
collector's license is not dispositive of the question whether
Palmieri fell within the collector exception to section 922(a)(1).
He must further prove that the firearms he bought and sold were
curios and relics and that the quantity of his transactions did not
make him a dealer. The record indicates that the district court
precluded Palmieri from fully presenting his collector exception
theory at the trial.
Palmieri has a colorable claim that he was only a collector
rather than a dealer. Palmieri served in the armed forces in the
early 1950's and became interested in firearms. Since then and for
about twenty-seven years, he had been collecting firearms "because
of the historical value of [the] military items, foreign and
domestic." App. at 368. Palmieri received a collector's license
from the appropriate authority to become a "licensed collector,"
and maintained this status properly.
Nor does the government dispute that the guns that Palmieri
sold to Lyman were all curios and relics. [footnote 9] The
circumstances of how he became interested in guns and the
relatively few transactions he made - three transactions with a
total of five items over a span of eight months between October
1991 and May 1992, to be exact - present a sufficient jury question
of whether he was merely a collector or, as the government argues,
a de facto dealer engaging in a regular course of trade in gun
dealing.
With respect to Count 2, the charge of violating section
922(o), the only issue was whether the machinegun at issue was a
curio or relic because section 922(o) does not contain a quantity
component. The government did not, and could not, dispute that the
machinegun at issue is a curio or relic. See ATF List, supra, at
30, App. 627. The record clearly supports Palmieri's claim of
collector exception to Count Two.
In sum, the record indicates that there is sufficient evidence
to present a question for the jury to determine whether Palmieri
was a dealer in firearms, or merely a collector, in Count 1. On
Count 2, the charge cannot be established as a matter of law since
the only machinegun at issue is classified by the government itself
as transferrable as a curio or relic.
IV.
Having concluded that the gun collector exception is a valid
legal theory under the applicable law, and there is evidence in the
record which supports the Palmieri's position that he was a gun
collector and not a dealer, I next examine the jury charge as a
whole to see whether it adequately embodied the theory of
Palmieri's defense. See Paolello, 951 F.2d at 543.
The only portion in the jury charge that addressed the
collector exception to section 922(a)(1) was its paraphrasing of
the statutory definition of "engaged in the business." There the
district court stated:
The term "engaged in the business" means a person who devotes
time, attention and labor to dealing in firearms as a regular
course of trade or business with the principle objective of
livelihood and profit through the repetitive purchase and
resale of firearms, but the term does not include a person who
makes occasional sales, exchanges or purchases of firearms for
the enhancement of a personal collection or for a hobby, or
who sells all or a part of his personal collection of
firearms.
App. at 522. Obviously, this part of the instruction tracked the
language of the definition in 18 U.S.C. section 921(a)(21)(C). It
was not incorrect, but it did not provide sufficient guidance to
the jury on the collector exception to section 922(a)(1) since it
failed to adequately address the distinction in terms of the
quantity of transactions between a collector and a dealer.
While one might argue that the above instruction gave the jury
the alternative to find Palmieri a collector and not a dealer,
other portions of the charge eliminated that alternative. This was
accomplished by what I believe to be misstatements of the law on
the status of a licensed collector. For example, the court
instructed the jury:
In this case, you have heard testimony that during the time
period covered by the indictment, the defendant, James
Palmieri, was a licensed firearms collector. I instruct you as
a matter of law, that the collector's license possessed by the
defendant did not authorize him to sell any firearms, even
firearms that have been classified as curios or relics. I
further instruct you that what the defendant believed his
collector's license authorized him to do is not an issue in
this case, it is therefore,[sic] irrelevant to your
determination of the charges in this case.
App. at 523. Even by the majority's admission, this portion of the
jury charge is "potentially misleading." Op. at 1269. I believe it
is more than that. As discussed above, a gun collector does not
need a collector's license to buy and sell gun curios and relics
within his home state, but only a licensed collector can buy and
sell curios and relics in interstate transactions. The jury charge
misstated the law with respect to interstate transactions because
a collector's license does authorize interstate sales. More
importantly, this portion of the charge instructed the jury that a
collector cannot lawfully make any sales, with or without a
license. This is, again, clearly incorrect, since even without a
gun collector's license a collector is permitted to make certain
intrastate transactions. This part of the jury instruction
completely precluded the jury from considering whether Palmieri
fell within the gun collector exception when he sold the guns at
issue in this case.
The response of the district court to the jury's last question
before the verdict was returned was an even more serious
misstatement of the law, and a substantial source for confusion.
The jury asked: "Do you need a license to sell firearms under all
circumstances?" App. at 539. The question indicates that the jury
was puzzled by the difference in quantity between the number of
transactions that a collector can engage in and the number of
transactions which would make one a dealer in firearms. The term
"license" in the question from the jury clearly refers to the
firearms dealer's license.
The proper answer to the jury question should have been a
resounding "no," because, without a gun dealer's license, a
collector without a federal collector's license is permitted to
make certain intrastate sales; a collector with a federal
collector's license may, in addition, make certain interstate
sales. The district court, however, responded:
[T]he best answer I can give you to this is that that is not
your concern as a jury. You do not need to know everything
about under what circumstances a person could or could not do
this. ... I refer you to the instruction that you received ...
which is I instructed you as a matter of law that the
collector's license possessed by the defendant did not
authorize him to sell any firearms. . . .
App. at 541-42.
Not only did the district court repeat its incorrect
instruction on the status of the licensed gun collector, it also
miscomprehended the importance of a correct answer to the jurors
who were confused as to whether Palmieri was guilty merely because
he sold guns. In its response to the question of the jury, the
district court instructed that the jury "need not know everything
about under what circumstances a person could or could not do." Id
The jury was never told that an individual does not need a dealer's
license to sell firearms under all circumstances. If the jury was
properly instructed, it would have been equipped to make a judgment
on whether Palmieri was a dealer or merely a collector. As a
dealer, he would have been required to be licensed as a dealer,
while as a collector, he did not need a dealer's license for
intrastate sales. If it had been properly instructed, the jury may
well have concluded the limited transactions that Palmieri made
were not sufficient to bring him within the definition of a firearm
dealer, particularly since the record reflects the activities of an
infrequent seller who sold five curio firearms in three
transactions over a period of eight months between October 1991 and
May 1992, and with only one buyer involved. Because the jury
charge did not reflect the gun collector defense to Count 1, we
should reverse the conviction on Count 1, and remand for a new
trial.
With respect to the charge in Count 2, alleging a violation of
section 922(o), the jury instruction never mentioned any gun
collector exception to such a charge. See App. at 524-25. The
district court essentially instructed the jury that in order to
convict Palmieri it must find beyond a reasonable doubt merely that
"the defendant possessed and transferred a machinegun," id. at 524,
and that "the defendant acted knowingly," id. The charge to the
jury was improper since it failed to set forth any directions or
instructions on the gun collector exception to section 922(o).
Ordinarily, this would require a remand for a new trial. However,
because the gun collector exception to section 922(o) does not
depend on the number of transactions, and since the record is clear
that the only machinegun at issue is, in fact, a curio or relic,
the government cannot prove Count 2 as a matter of law. Thus, we
should direct the district court to dismiss Count 2 rather than
remand for a new trial.
V.
Judge Nygaard interprets section 922(o) as an absolute ban on
possession and transfer of any machinegun, even a machinegun that
is a curio or relic, with the limited exceptions provided by the
explicit language of section 922(o)(2)(A) and (B) which are not
relevant in this case. It therefore becomes necessary to address
the serious due process problem posed in this case by the ATF
official position that machineguns which are classified as curios
or relics may be possessed and transferred. On the one hand, the
Secretary as administrator, and therefore an official expositor of
the Gun Control Act, specifically advises collectors they can buy
and sell certain machineguns if they are on the official list of
curios and relics. On the other hand, the United States Attorney
can, and in this case did, prosecute anyone for possessing any
machinegun, even if it is on the official ATF list of curios and
relics. This state of affairs raises serious questions of notice
and fairness. Even if we have the power to read section 922(o)
broader than Congress intended, as Judge Nygaard does, we must
nevertheless reverse Palmieri's conviction on Count 2.
Although a mistake of law is generally not an excuse to a
criminal charge, the law recognizes the government should not
prosecute a citizen who is misled by an official interpreter of the
law. In Raley v. Ohio, 360 U.S. 423, 79 S.Ct 1257, 3 L.Ed.2d 1344
(1959), the Supreme Court held that the state may not convict a
person for refusing to answer questions of a state investigating
commission when that person relied upon assurances of the
commission that state law afforded him a privilege to refuse to
answer (although such privilege did not in fact exist). Id. at
425-26, 79 S.Ct at 1259-60. To sustain such a conviction, the Court
reasoned, "would be to sanction an indefensible sort of entrapment
by the State--convicting a citizen for exercising a privilege which
the State had clearly told him was available to him." Id. at 426,
79 S.Ct. at 1260. Several years later, the Supreme Court again held
that defendants may not be convicted for demonstrating near a
courthouse when the police chief in the presence of the Sheriff and
the Mayor told them it was permissible to do so. Cox v. Louisiana,
379 U.S. 559, 568-72, 85 S.Ct. 476, 482-84, 13 L.Ed.2d 487 (1965).
These cases demonstrate that when a defendant is misled by
assurances of an official interpreter of the law that the conduct
in dispute is permissible, he cannot be subsequently prosecuted for
that same conduct. Otherwise, the law would sanction indefensible
entrapment by the government. This rule takes on greater importance
when the law at issue is as complex as the Gun Control Act.
Palmieri is clearly within the protection of the Raley rule.
ATF has published a list of curios and relics embodying its
official interpretation of the interface between "machinegun" and
"curios and relics," and specifically stated that these machinegun
curios can be transferred. See ATF List, supra, at 3, 29; App. at
621, 626. There is no dispute that the machinegun at issue in this
case is contained in that list. Palmieri, like all others, was
advised by the Secretary's official publication that he can possess
and transfer the machinegun at issue in this case. His conviction
on Count 2 for possessing and transferring that machinegun must be
set aside.
Finally, before Judge Nygaard made known his holding, it was
by no means clear that Palmieri's reading of the statute
(permitting him to possess and to transfer a machinegun that is a
curio or relic on the ATF list) was a mistaken interpretation of
the law. By reason of sections 921(a)(13), 922(a)(4) and (b)(4),
Palmieri could reasonably conclude that the Gun Control Act
permitted him to possess and transfer the machinegun at issue. The
reasonableness of this conclusion is verified by the very same
interpretation by ATF. At most, this reasonable interpretation
conflicted with section 922(o). Where a statute authorizing
criminal sanctions "gives conflicting commands," United States v.
Cardiff, 344 U.S. 174, 176, 73 S.Ct. 189, 190, 97 L.Ed. 200 (1952),
the government cannot enforce the statute by punishing a citizen
whose interpretation was reasonable. Id.
In Cardiff, the defendant was convicted of violating the then
existing section 301(f) of the Federal Food, Drug, and Cosmetic
Act, 21 U.S.C. section 331(f), which prohibited the refusal to
permit entry or inspection as authorized by section 374. Section
374 in turn authorized federal officers or employees "after first
making request and obtaining permission of the owner" of a plant to
enter or inspect the establishment at reasonable times. Id. at
174-75, 73 S.Ct at 189. The Supreme Court recognized that the
statutory provisions could have reasonably been interpreted as
"prohibit[ing] the refusal to permit inspection only if permission
has been previously granted." Id. at 176, 73 S.Ct. at 190. The
Court also recognized that the government might have been correct
in arguing that the statute should be read as "prohibiting a
refusal to permit entry or inspection at any reasonable time." Id.
The Court concluded, the statute "makes inspection dependent on
consent and makes refusal to allow inspection a crime." Id. The
Court ruled that such a statute cannot be enforced because
enforcement "would be making an act criminal without fair and
effective notice." Id. The provisions of the Gun Control Act with
respect to machinegun possession and transfer are similar to those
addressed in Cardiff in that both are susceptible of conflicting,
yet reasonable, interpretations. Therefore, section 922(o) should
not be enforced.
Judge Nygaard attempts to remedy this constitutional problem
by asserting that the Secretary did not state that the machinegun
at issue is transferrable. The reason Judge Nygaard gives is that
ATF indicated that the machineguns in the list can only be
transferred subject to the section 922(o) absolute ban on
machinegun possession and transfer save when a machinegun was
possessed before May 19, 1986. This is entirely unpersuasive.
Quoting a paragraph from the ATF curios and relics list, Judge
Nygaard states that licensed collectors are permitted only to
"acquire[,l hold or dispose of them [the weapons listed in Section
IV] as curios or relics subject to the provisions of 18 U.S.C.
Chapter 44 [which include 18 U.S.C. section 922(o)] and 27 CFR part
178." Maj.Op. at 1275 ("[which include 18 U.S.C. section 922(o)]"
was added by Judge Nygaard). However, the sentence in the ATF list
immediately following the quoted language states that "[t]hey are
still 'firearms' as defined in the National Firearms Act and
Chapter 44 of Title 18, U.S.C." ATF List, supra, at 29, App. at
626. Thus the "subject to" language must be read as primarily
concerning the "firearm" status of the curios and relics so that
the collectors are on notice that if they trade curios as a regular
course of business without a dealer's license, they may be
violating the Gun Control Act, see 27 C.F.R. section 178.41(d)
(1993) (specifically cautioning collectors to obtain further
licenses if their activities amount to a regular course of trade),
and that they may need to comply with the registration and taxation
requirements under the National Firearms Act.
Reading the "subject to" language as reinstating the section
922(o) absolute machinegun prohibition renders superfluous almost
the whole Section IV of the ATF curios and relics list, which is
itemized with machinegun curios and relics. We should not lightly
assign such a purpose to the ATF, an expert administrative agency
charged with administering the Gun Control Act.
Judge Nygaard contends that his reading of section 922(o)
leaves Section IV of the ATF curios and relics list some use,
asserting that this part of the list is "potentially useful to
those who lawfully possessed a machine gun before May 19, 1986."
Maj.Op. at 1275. I have pointed out that Judge Nygaard's reading
of section 922(o) would ban a private citizen from receiving a
machinegun after May 19, 1986. See supra at 1281. Thus, under
Judge Nygaard's reading of section 922(o), Section IV of the ATF
list could not be of any use at all so far as private transfers are
concerned. No legal transaction could take place because even
though one side of the transaction - the seller - could transfer a
machinegun, the other side - the buyer - could not receive or
possess it. But private transfers are exactly what the ATF
authorized. See ATF List, supra, at 3; App. at 621.
The only use of Section IV of the curios and relics list,
Judge Nygaard indicates, is that it permits a transfer to be made
to a governmental instrumentality under section 922(o)(2)(A). See
Maj.Op. at 1275 (citing to section 922(o)(2)(A)). Assuming that
Judge Nygaard is correct, that part of the list is still useless,
because under section 922(o)(2)(A) a machinegun need not be a curio
or relic (that is, being listed in Section IV of the list) to be
eligible for transfer to a governmental agency. Any machinegun
(antique, curio or brand new) may be transferred to the federal or
state government under section 922(o)(2)(A). An expert agency such
as the ATF probably would not have promulgated a list that does
nothing.
By clear and unambiguous pronouncement, ATF has rejected the
position espoused by Judge Nygaard. ATF specifically stated that
"[o]nce the registration requirements have been met, transfer [of
the curios and relics in Section IV] may be made either intrastate
or interstate to licensed collectors on ATF Form 4." ATF List,
supra, at 3; App. at 621 (emphasis added). It is well to emphasize
that the ATF specifically permits transfers to be made to "licensed
collectors" who are private citizens. This language clearly rebuts
Judge Nygaard's contention that the Section IV was meant to permit
transfers to governmental instrumentalities and that section 922(o)
categorically bans all private possession and transfer of
machineguns if an owner did not possess them before May 19, 1986.
Section 922(o) as construed by Judge Nygaard would ban these
collectors from receiving any machineguns after May
19, 1986. Many of the firearms in Section IV are machineguns, such
as the machinegun at issue in this case. This statement clearly
refutes any assertion that ATF considered the "absolute" ban under
section 922(o) applied to machineguns which are curios and relics.
Because of the constitutional complications, we are instructed
to construe a statute in such a way, if possible, so as to avoid a
difficult constitutional question. See Edward J. DeBartolo Corp. v.
Florida Gulf Coast Bldg. & Constr. Trades Council, 485 U.S. 568,
575, 108 S.Ct 1392, 1397, 99 L.Ed.2d 645 (1988) ("where an
otherwise acceptable construction of a statute would raise serious
constitutional problems, the Court will construe the statute to
avoid such problems unless such construction is plainly contrary to
the intent of Congress"). Judge Nygaard does not heed this
admonition. Instead, he reads section 922(o) as an absolute ban and
thus implicitly concludes that the Secretary through ATF has
exceeded its authority in listing the machineguns as curios. Judge
Nygaard thus states that "to the extent that [Section IV of the ATF
curios and relics list] contradicts 18 U.S.C. section 922(o),
however, the statute trumps the ATF publication." Maj. Op. at 1275.
Even if Judge Nygaard is correct, case law as analyzed above
mandates that we dismiss Count 2 (the machinegun charge) since
Palmieri was misled by ATF. Under the holding of Raley v. Ohio, 360
U.S. 423, 79 S.Ct. 1257, 3 L.Ed.2d 1344 (1959), Cox v. Louisiana,
379 U.S. 559, 85 S.Ct 476, 13 L.Ed.2d 487 (1965), and United States
v. Cardiff, 344 v.S. 174, 73 S.Ct. 189, 97 L.Ed. 200 (1952),
Palmieri must be set free on Count 2 if he was misled by the ATF
official interpretation of the Gun Control Act or if the statutory
provisions gave conflicting commands. There is no doubt that the
provisions of the Gun Control Act are susceptible of conflicting
interpretation and that Palmieri was misled by the official
interpretation of the Secretary-the administrator of the Act.
Palmieri was charged with possessing and transferring a machinegun
that ATF has recognized it is permissible to possess and transfer.
A fundamental element of due process is fair notice. "[A] fair
warning should be given to the world in language that the common
world will understand, of what the law intends to do if a certain
line is passed." McBoyle v. United States, 283 U.S. 25, 27, 51
S.Ct 340, 341, 75 L.Ed. 816 (1931). Born of the concern for fair
notice, the venerable rule of lenity "demand[s] resolution of
ambiguities in criminal statutes in favor of the defendant." Hughey
v. United States, 495 U.S. 411, 422, 110 S.Ct. 1979, 1985, 109
L.Ed.2d 408 (1990). See also United States v. Granderson, -- U.S.
--, --, 114 S.Ct. 1259, 1267-69, 127 L.Ed.2d 611 (U.S.) ("In
[those] circumstances--where text, structure, and history fail to
establish that the Government's position is unambiguously
correct-we apply the rule of lenity and resolve the ambiguity in
Granderson's favor."). This rule takes on greater importance when
complex statutes such as the Gun Control Act and the National
Firearms Act are involved. See United States v. Thompson/Center
Arms Co., -- U.S. --, --- (plurality op.) & ---, 112 S.Ct. 2102,
2109-10 (plurality op.) & 2112, 119 L.Ed.2d 308 (Scalia, J.,
concurring) (1992) (applying the rule of lenity in construing
National Firearms Act in a civil case when the government attempted
to tax the defendant). This rule requires that Judge Nygaard's
interpretation not be applied to Palmieri, even though it may bind
the whole world in a future case. Judge Nygaard today disregards
this rule, and does so without discussion. [footnote 10]
With Judge Nygaard's reading of section 922(o), gun collectors
and museums, who currently possess or transfer curio or relic
machineguns as a hobby or for historical and educational purposes,
are at risk. They most likely will not be in a position to claim
the explicit exceptions to the absolute machinegun ban as provided
in section 922(o)(2A)(A) and (B). In order to avoid any further
misleading of those who are gun collectors, the court should
explicitly nullify the part of Section IV of the ATF curios and
relics list which contains machineguns, and thwart the ATF from
placing that part of the list in public circulation.
VI.
To support Palmieri's conviction, the government argues that
Palmieri also violated 27 C.F.R. section 178.94 and the
registration requirements of the National Firearms Act. What
bearing any violation by Palmieri of 27 C.F.R. section 178.94 or
the National Firearms Act has on the charges that Palmieri was
convicted of is not explained by the government. Nor could any
attempted explanation be made since Palmieri was charged solely
with violating section 922(a)(1) and (o). He was not charged with
violating either 27 C.F.R. section 178.94 or the National Firearms
Act. Whether Palmieri violated these other statutes and
regulations is not relevant to whether he violated section
922(a)(1) and (o). Palmieri cannot be convicted of violating a
statute because, presumably, he violated some other law unrelated
to the charge before the court.
The record indicates that Palmieri may not be faultless. He
may have violated other sections of the Gun Control Act, certain
requirements with respect to registration and taxation under the
National Firearms Act, as well as New Jersey gun control law.
Perhaps Palmieri should have been charged with these violations.
But he was not. The government may have chosen the wrong statute to
prosecute a citizen. But we are not impanelled to correct a
charging error by the government. We are required to determine if
Palmieri is guilty as charged. Clearly, he is not.
VII.
For the foregoing reasons, I dissent. I would reverse the
conviction on both counts and remand the case for a new trial on
Count 1 and direct that the district court dismiss Count 2.
SUR PETITION FOR REHEARING
May 11, 1994
Present: SLOVITER, Chief Judge, BECKER, STAPLETON, MANSMANN,
GREENBERG, HUTCHINSON, SCIRICA, COWEN, NYGAARD, BOTH and LEWIS,
Circuit Judges.
The petition for rehearing filed by appellant in the
above-entitled case having been submitted to the judges who
participated in the decision of this court and to all the other
available circuit judges of the circuit in regular active service,
and no judge who concurred in the decision having asked for
rehearing, and a majority of the circuit judges of the circuit in
regular active service not having voted for rehearing by the court
en banc, the petition for rehearing is denied.
FOOTNOTES
1. The preferred spelling is "machine gun." Because Congress used
"machinegun," see 18 U.S.C section 921(a)(23). I will also do so
throughout this dissent.
2. Antique firearms are defined as those manufactured in or before
1898. 18 U.S.C. section 921(a)(16).
3. The Secretary of Treasury has defined "curios and relics" as:
Firearms which are of special interest to collectors by reason
of some quality other than is associated with firearms
intended for sporting use or as offensive or defensive
weapons. To be recognized as curios or relics, firearms must
fall within one of the following categories:
(a) Firearms which were manufactured at least 50 years prior
to the current date, but not including replicas thereof;
(b) Firearms which are certified by the curator of a
municipal, State, or Federal museum which exhibits firearms to
be curios or relics of museum interest; and
(c) Any other firearms which derive a substantial part of
their monetary value from the fact that they are novel, rare,
bizarre, or because of their association with some historical
figure, period, or event. Proof of qualification of a
particular firearm under this category may be established by
evidence of present value and evidence that like firearms are
not available except as collector's items, or that the value
of like firearms available in ordinary commercial channels is
substantially less.
27 C.F.R. section 178.11 (1993). More specifically, the Bureau of
Alcohol, Tobacco and Firearms (ATF) publishes a list of curios and
relics, naming specific firearms as curios and relics. See ATF,
Firearms Curios and Relics List (1972-1989), ATF P. 5300.11 (1990
ed.). App. 618-27.
4. Judge Hutchinson declines to join Part VII of Judge Nygaard's
opinion. Part VII of Judge Nygaard's opinion is therefore that of
his own alone, not that of the court. Judge Hutchinson, however,
concurs in the judgment affirming the district court's decision on
the ground that Palmieri waived his argument on the invalidity of
Count 2. See Maj.Op. at 1274 n. 10. I respect fully disagree with
this waiver theory.
First, I believe the issue is fairly raised by Palmieri.
Although he has not done so in the precise wording or analysis that
I employ, he contends that his collector's license authorized him
to sell all the guns at issue in this case and that the machinegun
was not a machinegun within the meaning of section 922(o) and
therefore he had no requisite intent to violate that provision.
Brief for Appellant at 26-27. Moreover, at oral argument counsel
for Palmieri specifically requested the court direct that the
district court dismiss Count 2.
Secondly, the issue is in essence whether it is a crime to
sell the machinegun at issue. When the sale is not a crime, a
defendant simply cannot be convicted for conduct that is not
criminal. This goes to the sufficiency of the indictment. There
is no waiver as to such a question. See Menna v. New York, 423
U.S. 61, 62 & n. 2, 96 S.Ct. 241, 242 & n. 2. 46 L.Ed.2d 195 (1975)
(per curiam). Menna pleaded guilty to a charge, but he subsequently
appealed the conviction on the ground that the indictment was
invalid because it was barred by the guarantee against double
jeopardy. Id., at 61, 96 S.Ct at 241. The state contended that
Menna waived his objections to the charge by virtue of his guilty
plea. Id. In a per curiam opinion, the Supreme Court rejected this
argument flatly:
Where the State is precluded by the United States Constitution
from haling a defendant into court on a charge, federal law
requires that a conviction on that charge be set aside even if
the conviction was entered pursuant to a counseled plea of
guilty.
Id. at 62, 96 S.Ct. at 242. In a footnote, the Court stated that "a
plea of guilty to a charge does not waive a claim that-judged on
its face-the charge is one which the State may not constitutionally
prosecute." Id. at 62 n. 2, 96 S.Ct 242 n. 2.
This rule equally applies to the federal government. If my
analysis is correct, Count 2 is an invalid charge that the
government may not constitutionally prosecute. Therefore,
Palmieri's alleged silence does not waive his claim that Count 2
was invalid.
Finally, as an appellate court, we have the power to
adjudicate an issue even if not raised or briefed. "In exceptional
circumstances, especially in criminal cases, appellate courts, in
the public interest, may, of their own motion, notice errors to
which no exception has been taken, if the errors are obvious, or if
they otherwise seriously affect the fairness, integrity, or public
reputation of judicial proceedings." United States v. Atkinson,
297 U.S. 157, 160. 56 S.Ct. 391, 392. 80 L.Ed. 555 (1936) (emphasis
added). The case sub judice is a criminal case and the invalidity
of Count 2 is an issue that we should decide.
We have stated that "[e]xceptional circumstances have been
recognized when the public interest requires that the issue be
heard or when manifest injustice would result from the failure to
consider the new issue." Altman v. Altman, 653 F.2d 755, 758 (3d
Cir. 1981). Public interest requires that we decide this issue
because the statute touches an important aspect of our life and
concerns the liberty interest of many gun collectors. The statute
was recently enacted, and thus cries out for clarification.
Manifest injustice would result from our failure to consider the
issue. If my analysis is correct, Palmieri, for one, will stay in
jail for committing no crime. The United States attorneys may use
our decision to indict more people similarly situated.
5. The ATF pursuant to its authority has removed certain antique
firearms from the coverage of both the National Firearms Act and
the Gun Control Act and listed those items in Section IIIA of the
ATF list. The fact that the machine gun at issue in this case does
not fall within the category of weapons removed from the National
Firearms Act does not affect Palmieri's claim. First, the National
Firearms Act requires primarily that owners register their firearms
and pay a tax on them. It is different from the Gun Control Act.
Furthermore, those firearms removed from the National Firearms Act
constitute Section IIIA, which is only part of the ATF curios and
relics list. More specifically, this section contains a list of
antiques, which technically are not "curios and relics," as defined
by ATF, see App. at 625. Even though the exemption accorded an
antique is broader than that accorded a curio, the fact that the
machinegun at issue in this case does not fall within the antique
category does not affect its curio status. The machinegun is within
another part (Section IV) of the curios and relics list.
6. This exception appears to apply only to those who lawfully
possessed a machinegun before the effective date. It does not seem
to apply to collectors who did not own any machineguns as of that
day.
7. Some courts have considered section 922(o) and 26 U.S.C. section
5861 irreconcilable. See. e.g., United States v. Dalton, 960 F.2d
121, 126 (10 Cir. 1992) (section 922(o) impliedly repealed I.R.C.
section 5861(d) and (e), part of the National Firearms Act
requiring registration of machineguns because section 922(o) makes
it impossible for anyone who purchases a machinegun after 1986 to
comply with section 5861), cert. denied, -- U.S. --, 114 S.Ct. 253,
126 L.Ed.2d 205 (1993); but see United States v. Staples, 971 F.2d
608, 610-11 (10th Cir. 1992) (distinguishing Dalton because the
machinegun at issue was purchased before section 922(o) went into
effect), cert. granted, -- U.S. --, 113 S.Ct. 2412, 124 L.Ed.2d 635
(1993); United States v. Kurt, 988 F.2d 73, 76 (9th Cir. 1993)
(section 922(o) does not completely repeal I.R.C. section 5861(d)
because if the machineguns were lawfully possessed before 1986, the
defendant can meet the registration requirements). These cases
concern the validity of the registration requirement after the
enactment of section 922(o), and do not address the issue presented
in this case.
8. In his brief. Palmieri asserts the gun collector exception as a
defense to the charge under section 922(a)(1). With respect to the
charge under section 922(o), his argument is different. Here, he
claims that he could not be convicted of violating section 922(o)
because the machinegun at issue is a curio or relic. This argument
goes to an element of the offense.
If the claim relates to a defense, the government is not
required to prove its existence or absence. Rather, the law may
require the defendant to prove the defense by a preponderance of
the evidence. Martin v. Ohio, 480 U.S. 228, 235-36, 107 S.Ct.
1098, 1103, 94 L.Ed.2d 267 (1987); Patterson v. New York, 432 U.S.
197. 205-212, 97 S.Ct. 2319, 2324-28, 53 L.Ed.2d 281 (1977). On the
other hand, if the issue in dispute goes to the elements of the
offense, or if it bears some necessary relationship to an element
of the offense, see Mullaney v. Wilbur, 421 U.S. 684, 705-07, 95
S.Ct. 1881, 1893, 44 L.Ed.2d 508 (1975) (Rehnquist, J.,
concurring), the government bears the burden of proof to establish
its existence or absence. In re Winship, 397 U.S. 358, 364, 90
S.Ct. 1068, 1073, 25 L.Ed.2d 368 (1970).
My analysis of the statutory provisions indicates that the gun
collector exception goes to an element of the offense in each
count. As to section 922(a)(1), the gun collector exception
addresses the quantity of transactions and, thus, the "regular
course of trade" element. The collector exception as applied to
section 922(o) addresses what is a machinegun within the meaning of
that section. Therefore, the government should bear the burden of
proving that Palmieri is not a collector as to both counts.
However, the distinction between who bears the burden of proof
is not critical in this appeal because Palmieri was precluded from
presenting his claimed "defense."
9. These firearms at issue were manufactured before or during World
War II and thus are within the definition of curios and relics
under 27 C.F.R. section 178.11 (firearms must be fifty years old in
order to be recognized as curios and relics).
10. As I pointed out in supra note 4, Judge Hutchinson does not
join in Part VII of Judge Nygaard's opinion, but would affirm the
judgment of the district court on a waiver theory. Judge Nygaard
does not concur in this waiver theory.
Accordingly, the court's affirmance of Palmieri's conviction
is the by-product of two different theories of two judges
comprising the majority. This fact alone requires that we apply
the rule of lenity in favor of Palmieri.